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Unemployed homeowners will have to give a stake of the equity in their home to
the State in return for help in paying their mortgage, under a plan favoured
by ministers.

The move would break new ground in funding the welfare state and could save
millions of pounds. Under the proposals, unemployed homeowners who qualify
for the scheme would be given indefinite help paying the interest on their
mortgage. The State would recoup some of the money when the claimant died or
sold their property.

The benefit, called Support for Mortgage Interest (SMI), was paid to 239,000
recipients last year